5 LEADERSHIP LESSONS FROM THE FOUNDER OF GOOGLE

Larry Page took the reins as CEO at Google on April 4.
Google’s (GOOG) general counsel Kent Walker portrayed the acquisition as a strong defense against patent trolls, but acknowledged that it also gives the company room to grow and add to its Android apps and usability.
Spending $1 billion on patents offers an important clue to what matters most to Page: innovation. While some say he is trying to emulate Steve Jobs and Apple (AAPL), Page’s leadership style is distinct — and shaped by both his background as an engineer and his upbringing as the son of two computer science professors in Michigan, where he likely learned lessons from General Motors’ (GM) woes.
Page has spent his entire career at Google, and while he remains something of an enigma, his leadership style and ideals are becoming increasingly clear; he talks about them in commencement speeches, in talks to faculty, and to co-workers and Google executives. His management style is relevant to anyone who’s growing a business or looking to stay ahead of fierce competitors, not to mention complacency. Here, then, are five leadership strategies from Larry Page:

Pay attention to your crazy ideas and cultivate the best of them.

“Talk about the future,” Page told University of Michigan’s engineering graduates in 2005 — back when Google had 3,500 employees, one-eighth as many as it does now.

Page urges his teams to believe in audacious ideas. By tackling big ideas “that could really change the world,” you attract incredibly smart people and achieve something worthwhile, even if it’s not your original goal, he said at the Google Faculty Summit in 2009. The Google group researching artificial intelligence instead came up with the ad targeting system, which accounts for almost half of revenues, said Page, adding: “That’s a pretty good side effect.”

The idea for Google’s search engine came to Page in a dream about downloading the entire web and keeping the links, he told Michigan graduates. “When no one else is crazy enough to do it, you have little competition,” he said.

Page is “very engaged in what challenges people face,” and his engineering brain often kicks in, says Grady Burnett, who led Google’s AdWords office in Ann Arbor for five years and now works for Facebook. That perspective is backed up with the $36 billion Google has in cash and marketable securities — and with a research and development budget last year of $3.8 billion — up by a cool $1 billion from 2008 and 2009.

Build your team, avoid bureaucracy.

For years, Page insisted on being involved in every hire at Google. Many of his early hires were graduates of University of Michigan or Stanford University, where he and co-founder Sergey Brin met while in graduate school. While some have left to establish their own companies, many have stuck around because of his approach. Three of the six people recently promoted to lead Google’s major product divisions are among the first 10 or so employees the company hired, dating back to 1998.

“It’s remarkable,” says Steven Levy, author of the recently published book In the Plex, a look inside Google. “Those people are rich enough to buy anything — and they’re still working, committing to a few more years” with the company. “It’s a belief in Larry,” says Levy, who is also a senior writer for Wired.

Yet even as Page and his recruiters continue to seek thousands of bright young graduates to join Google, he is quietly cutting or reassigning middle management and bureaucracy. The company’s recent reorganization reinforces that notion.

“He has a problem with traditional management. He doesn’t like it,” says Levy, who has interviewed Page about six times.

Be quick. Be concise.

Page is working to cultivate a faster, more nimble management approach at Google, which employs 26,000 people around the world. He has asked staff to give him 60-word updates or pitches on their current projects, according to the Wall Street Journal. That comes out to about two compressed paragraphs to impress and compel.

Page is also looking to encourage faster decisions and openness. Top executives are said to sit around together for one day a week — time for collaboration and quick choices. And he’s looking to encourage the immediacy-minded attitude that prevails at YouTube, according to the San Jose Mercury News.

Recognize the significance of small moves.

Google’s staff persistently tinkers with its products, adding new features and improving the usability of Gmail, its search engine and Android. They improve and improvise all the time. Page told an audience in Europe that he gets “a new build” on his Android phone each day. “It continues to work better and better every day.”

The company is also focused on connecting with students, its future staff and user base. Many of its satellite offices are located in college towns across the country. In metro Detroit, it offers classes at high schools and colleges to teach them to use AdWords for nonprofits and charities.

“We’re training the 21st Century workforce, and making a significant impact on local Michigan nonprofits,” says Bud Gibson, an Eastern Michigan University professor of computer information systems.

Even if the students never set foot in the Googleplex headquarters, they can use the skills to join a Web 2.0 company and press for more use of Google products. These small steps may bring big rewards and improve Google’s reputation. Just as important, they focus on getting Google’s products into more hands.

Persevere.

It took Page some six years to get staff to work on Google’s book digitization project. He came up with the idea when he and Brin were students at Stanford, and the first books were scanned in 2004.

It also took years to launch what has become Google Maps with Street View. “I had the camera in my car and took a bunch of video,” he told the Google Faculty Summit in 2009. After convincing himself it would work, he kept working on convincing others.

Page’s interest in alternative fuel cars dates back to when he joined the Michigan Solar Car Team around 1993. Now Google is adding details on where to recharge electric cars on its maps and working on a robotic car that drives itself – the kind of idea that people expect Page to continue to launch no matter the payoff.

The book project may test Page’s perseverance, which has been targeted by publishers and authors who say the project infringes on their copyrights and gives Google a huge advantage over competitors. In late March, a federal judge threw out Google’s proposed settlement, saying it would have given Google significant rights to exploit entire books without permission of the copyright owners.

For all the leadership lessons Page has to offer, he certainly has some he still must master. He needs to communicate more, whether it’s to the media, to Google’s partners and to others, says Levy. “If you’re the CEO, you’ve got to be communicating more to the outside world.”

Page may have already paid a hefty price for this particular quality. Google stock declined by more than 8% Friday, one day after its earnings announcement. Some are chalking this decline up to the fact that Page did not hold a Q&A session with investors at a post-earnings conference call last week.

Google media relations declined to provide Page or a senior manager for an interview for this piece.

Page also may need a lesson or two on dealing with adversity, especially as it relates to government anti-trust regulators. Aside from the book project suit and subsequent delays, he may not have really grappled with too many obstacles — until now.

Microsoft (MSFT) recently filed an antitrust-related complaint against the company, and Google’s size and dominant market share in search and advertising will likely trigger additional complaints in the European Union, an EU official recently told Bloomberg News. Sometimes it seems that Page and Google may not consider the backlash or cost of defending themselves. Page has the mindset, Levy says, “This is worth doing” without sensitivity toward regulators and reputation.
Last week, Google reported a 17% increase in quarterly net income (to $2.3 billion) from the previous year but missed Wall Street’s forecasts. The company also said that they were gearing up to hire 6,200 new staffers, the largest hiring spree in its 13-year history. “I’m very, very optimistic about our future,” Page said in brief comments.
Whether or not his optimism and his approach to leadership are worthy of imitation remains to be seen.